Background: Giardia and Cryptosporidium are the most common causes of protozoan diarrhea that lead to significant morbidity and mortality worldwide. The purpose of this study was to determine the prevalence of Giardia duodenalis and Cryptosporidium species infections among children and cattle, and to assess the potential risk of zoonotic transmission. Methods: This cross-sectional study was conducted between January and April 2009 in Girar Jarso and Dera Districts of North Shewa Zone, Oromia Region, Ethiopia. A total of 768 stool specimens were collected and examined for intestinal parasites using direct wet mount with saline and formalin ether concentration methods. The modified Ziehl-Neelsen staining method was used for the detection of Cryptosporidium species. Statistical analysis was performed using SPSS software version 15. Results: Out of 384 children examined, 53 (13.8%) and 28 (7.3%) were positive for Giardia and Cryptosporidium infections, respectively. Similarly, of the total 384 cattle examined, 9 (2.3%) were positive for Giardia duodenalis and 30 (7.8%) were positive for Cryptosporidium infection. The prevalence of giardiasis was significantly higher among children who had close contact with cattle 33 (18.7%) compared to children who had no contact with cattle 20 (9.6%) (P < 0.05). Higher number of Cryptosporidium infection was also recorded in children who had close contact with cattle 15 (8.5%). Difference in prevalence of giardiasis and cryptosporidiosis among children was not statistically significant between males and females. On the other hand, difference in the prevalence of giardiasis among children was statistically significant between age groups. Conclusions: Higher prevalence of Giardia duodenalis infection detected among children was significantly associated with contact with cattle and manure that the children had. Further analysis using molecular techniques is needed to explain the existence of zoonotic transmission in the study area.